The BlackRock Bitcoin ETF will struggle in September

Despite a slight uptick in bitcoin prices this September, BlackRock's iShares Bitcoin Trust (IBIT) has experienced sluggish earnings. He earned $6.76 million for the month.

While IBIT is stagnant, other currencies are outsourced.

Bitcoin ETFs recorded $155 million in expenses.

The BlackRock Bitcoin ETF – IBIT has seen varying trading volumes. On September 16, it recorded an inflow of $15.82 million.

However, this profit was adjusted by the cost of 9.06 million dollars a week ago, which resulted in a modest net flow. In ten trading days this month, IBIT recorded zero net inflows.

Ironically, this happened when the price of Bitcoin rose by nearly 5% in a month, a situation that normally encourages massive cash flows.

Read more: How to trade Bitcoin ETF: A step-by-step approach

Overall, the ETF sector has seen a similar trend. The withdrawal of around $155.30 million from all over the place Bitcoin ETFs in September reflects widespread market skepticism. Despite these challenges, IBIT has performed relatively well, maintaining stable revenues during a period of marked volatility.

Amidst these developments, BlackRock shared new insights into Bitcoin. The asset management giant has released a report entitled “Bitcoin: A Unique Diversifier” which explains the potential of cryptocurrency as a diversification tool in portfolios.

The report emphasized Bitcoin's unique characteristics, such as its scarcity, decentralized nature, and global reach. These features strengthen its appeal as a hedge against traditional financial uncertainties.

BlackRock's analysis shows that Bitcoin has shown remarkable resilience over time.

Over the past ten years, Bitcoin has outperformed all major asset classes by seven times, with over 100% returns every year over the past decade.

“This performance comes from Bitcoin being the worst-performing asset in the other three of those 10 years, with four losses of more than 50%. In these historical cycles, it has shown the ability to recover from such weaknesses and reach new highs despite these extended bear market periods,” BlackRock said. .

Moreover, the report explores the role of Bitcoin as a safe-haven asset during global crises. BlackRock highlights Bitcoin's non-sovereign, decentralized nature, which protects it from geopolitical disruptions and economic instability that affect traditional asset classes.

Read more: Who will have the most Bitcoins in 2024?

The discussion on Bitcoin also extends to its impact on US fiscal policies. BlackRock cites rising institutional interest in Bitcoin as an alternative reserve asset amid rising concerns over US federal deficits and debt levels. This interest is reflected at the international level, a significant accumulation of credit has inspired similar ideas.

Despite these encouraging aspects, BlackRock advises caution due to Bitcoin's volatility and regulatory environment that could impact its adoption and valuation. While the asset manager does offer an interesting investment opportunity, Bitcoin recommends that it be carefully incorporated into diversified portfolios to manage its inherent risks.